Stocks Making New Highs in Surprising Places

by Darwin on March 3, 2009

What if I told you a year ago that the Dow Jones Industrial average would have lost over 50% of its value and that the leaders in the market would be selling pasta and, while the big three automakers were decimated, an auto parts supplier would also be a shining star. In my latest update on suprising stocks breaking 52-week highs, I wanted to highlight two such stocks.

Today, Autozone (AZO) broke through a 52-week high by rallying 8% on news that it posted a higher profit driven by Americans repairing their vehicles instead of buying new ones. I was just listening to a piece on Bloomberg this morning about how the cycle time for car utilization is drawn out big time as motorists hang on to their cars longer instead of buying/leasing new ones every few years. This portends bad things for the big three autos and taxpayers alike. The lightbulb never went off for me at the time, but it appears as though investors feel this is a trend that will continue. Given the dire predictions for domestic (and global) car sales for the next year, perhaps AZO is one that will continue to outperform. Year to date, shares are up 10% versus a decline of 22% for the DJIA.

Likewise, while the recession worsens and consumers do less “consuming”, the winner is Pasta at home. The largest such supplier of pasta, American Italian Pasta (AIPC) recently broke through a 52 week high and has continued to hold up well in comparison to the recent market declines. Year to date, shares are up over 40% versus a decline of 22% for the DJIA.

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